Cash Cow | Wells Fargo Now A Major Shareholder In For-Profit Prisons
Even though crime rates in American have either stabilized or gone down, the incarceration rate (especially for people who are in this country illegally) has gone up – way up. (As this video points out, more people are being incarcerated on civil charges, not criminal.)
Naturally, as with most changes in this country, this has more to do with profit than anything else – and now we find that Wells Fargo is a major shareholder in for-profit prisons. Hmm. So this is what’s taken the place of mortgages as the banking cash cow? From Salon:
As Wells Fargo has grown over the years, using its bailout funds to gobble up rival Wachovia and expand to the East Coast, so has the U.S. prison population. By 2008, one in 100 American adults were either in jail or in prison – and one in nine black men between the ages of 20 and 34, many simply for non-violent offenses, justice not so much blind as bigoted. Overall, more than 2.3 million people are currently behind bars, up 50 percent in the last 15 years, the land of the free now accounting for a full quarter of the world’s prisoners.
These developments are not unrelated.
A driving force behind the push for ever-tougher sentences is the for-profit prison industry, in which Wells Fargo is a major investor. Flush with billions in bailout money and an economic system designed to siphon wealth from the working class to the idle rich, Wells Fargo has been busy expanding its stake in the GEO Group, the second largest private jailer in America.
- At the end of 2011, Wells Fargo was the company’s second-largest investor, holding 4.3 million shares valued at more than $72 million. By March 2012, its stake had grown to more than4.4 million shares worth $86.7 million.
Unfortunately, it’s a safe investment. While a 50 percent growth in the number of human beings our society cages in rape factories may sound impressive – or perhaps the word is “revolting” – a study released last year by the Justice Policy Institute found that the private prison industry grew by more than 350 percent over the last decade and a half. While other industries of course benefit from state-granted privileges, companies like GEO profit by the state literally kidnapping and handing them clientèle, particularly as of late about-to-be-deported immigrants, of which President Barack Obama has ensured there is a steady, record-breaking supply.
“All prisons are awful,” says Melanie Pinkert, an activist based in Washington, DC, who along with other members of Occupy DC’s “Criminal Injustice Committee” is helping lead a boycott of Wells Fargo, which just expanded to the nation’s capital. “But private prisons take it to the next level.” Indeed, a recent report from the U.S. Justice Department found that at one GEO-run juvenile facility in Mississippi, sexual abuse was endemic, “among the worst that we have seen in any facility anywhere in the nation.” According to the report, GEO staff demonstrated:
- Deliberate indifference to staff sexual misconduct and inappropriate behavior with youth;
- Use of excessive use of force by [prison] staff on youth;
- Inadequate protection of youth from youth-on-youth violence;
- Deliberate indifference to youth at risk of self-injurious and suicidal behaviors; and
- Deliberate indifference to the medical needs of youth.
These findings, shocking though they may seem, are not surprising. With an eye on maximizing quarterly profits, privately run facilities are even less inclined than state-run prisons to treat their involuntary customers humanely, skimping on health care and anything else that could hurt their bottom line, particularly programs aimed at reducing recidivism. As the ACLU noted in a report released late last year, “Not only is there little incentive to spend money on rehabilitation, but crime, at least in one sense, is good for private prisons: the more crimes that are committed, and the more individuals who are sent to prison, the more money private prisons stand to make.”
Sure makes me feel better that our Clerk of Court, Sharon Bock, has recently rewarded Wells Fargo with a Palm Beach contract to maintain the county’s funds. They kept their lucrative contract by dropping their banking fees when Bock’s office put out for bids.
WEST PALM BEACH, FLA. (April 3, 2012) – Clerk Sharon Bock is proud to announce a new banking contract with Wells Fargo that will save Palm Beach County approximately $1 million over the next three years.
Clerk Bock, who is the independently elected county Chief Financial Officer, presented details of the new contract to the Board of County Commissioners during their Tuesday meeting.
“My goal as the county’s chief financial watchdog is to negotiate on behalf of the taxpayer, so that they receive the best service at the lowest possible cost,” Clerk Bock said. “This new banking contract substantially reduces banking fees from prior years, and will save $1 million in taxpayer dollars over the three contract years.”
The new contract cuts Wells Fargo’s banking and other fees, which amounts to a savings of approximately $233,000 a year. The deal also maintains the county’s current level of earnings credits at 50 basis points, which is one of the highest rates offered in the nation.
As of today, Wells Fargo owns 408 homes in Palm Beach County (foreclosures) and continues to foreclose on thousands more…
If you haven’t closed your Wells Fargo account yet, this would be a good time to do so.